Reduce reliance on tour operators, go online, Phuket hoteliers told

The message was loud and clear - if you want to own the customer and you want to have more control over your rates and yields, then resort hoteliers have to reduce their reliance on tour wholesalers or, for that matter, even OTAs.

The dilemma however is if you turn off the traditional or indirect tap too quickly, will the business flow from the new channel be as fast to fill rooms especially in a highly competitive market like Phuket?

Stories abound of traditional tour operators punishing hotels who pull inventory and raise rates on them. One hotel in Phuket for instance, after a rebranding, doubled its rates and tour operators gave it a wide berth, resulting in almost a 50% drop in occupancies. It took more than a year of begging and renegotiating before the hotel was once again featured in tour operators' brochures again.

Paul Southey, vice president-Asia Pacific of TravelCLICK, said hoteliers needed to decide which channel they wanted to focus on and if they wanted to reduce their reliance on tour operators, then distribution through the web was a good route.

Graham Tate, managing director of IDEAS, said hoteliers needed to understand guest preferences so they can market directly to their customers. "If you work with tour operators, you don't own the customer."

One question was raised from the floor as to whether the surge in online bookings that had been seen in 2009 would slow down when travel demand recovered.

Southey said, "That's up to the hoteliers. You own the stock. As business becomes more buoyant, it is incumbent upon you to do the best on behalf of your owners and give them the best return on assets."

He said that TravelCLICK's statistics for third quarter 2009 versus third quarter 2008 showed a marginal reduction in hotel bookings via brand and opaque sites and a marginal increase in OTAs across the Internet. There was also a decline through the GDS channel, he said.

Oliver Winzer of Amadeus Optims said it was important for hoteliers to know where your business comes from before they can decide on their channel mix. "You can't live without wholesalers but you also need direct business."

Rajitha Dahanayake, CEO, eMarketing Eye said it wasn't just the deals in 2009 that drove customers online - it's changing demographics and travel trends. "Nearly a quarter of the world's population is online, and this will grow to 50% soon. Search is also increasing. Buying behaviour has changed."

He said hotels should exploit these changes and not depend overly on indirect channels if they were going to do more with web distribution. "It's an opportunity for hotels to shift the balance between wholesalers and online."

Panellists said that wholesalers had been slower to react to the extreme market fluctuations seen in 2009. "Online gives a better response and higher margins. The economy is improving and customers won't go back to the old ways of bookings. Yes, you need wholesalers but you need to be careful how many rooms you give to them," said Southey.